But General John Abizaid, head of the Central Command which includes Iraq, insisted that "good, solid intelligence" -- not more US troops -- was needed to counter the threat, which was brought home by Tuesday's truck bombing that killed at least 23 people at UN headquarters in Baghdad.

Abizaid would not comment on who might be behind the UN bombing, but said Baathists and other groups have turned to "terrorism" as the Iraqi governing council has become more assertive and US-led forces have scored successes against them.

At a Pentagon press conference, Abizaid and Defense Secretary Donald Rumsfeld pointed to the capture of Ali Hassan al-Majid, a cousin of Saddam Hussein known as "Chemical Ali" for directing 1988 gas attacks against Kurds, as a sign of progress.

Abizaid said terrorism "clearly is emerging as the number one security threat. And we are applying a lot of time, energy and resources to identify and understand it and deal with it."

Radical activity is confined to the predominantly Sunni Muslim territory between Baghdad, Tikrit and Ar Ramadi in the north that has been a stronghold of the outlawed Baathist forces which were loyal to the ousted Iraqi leader, he said.

Ansar al-Islam, a group believed to have loose ties to al-Qaeda, has migrated in increasing numbers from northern Iraq to Baghdad, he said.

"It's not good for us when they get established in an urban area as you can well appreciate," Abizaid said.

"And we know that there are other foreign fighters -- and we have captured many of them -- that have come across from Syria.

"The lines of infiltration are difficult to stop because of the wide expanse of the border. But we're looking very hard on getting a handle on what we need to do to stop them," he said.

Abizaid and Rumsfeld stopped short of accusing Syria or Iran of supporting the outside groups. But the defense secretary said "they clearly are not being stopped by the countries they are coming from.

"I think the terror cells are definitely established, primarily in Baghdad, operating through some of the western areas, and the threat from the terrorists is increasing, and we will counter their actions appropriately," Abizaid said.

"I wouldn't say they have become allies per se, but I believe there are some indications of cooperation in specific areas," he said.

"Of course, ideologically they are not at all compatible. On the other hand you sometimes cooperate against what you consider a common enemy," he said.

Earlier, Secretary of State Colin Powell appealed to United Nations members to contribute troops to a US-led multi-national force to stabilize Iraq.

Abizaid said he intends to use foreign troops and some 50,000 newly trained Iraqi police, border guards and other forces to take over some "internal security" duties, and shift the US military presence toward border areas.

A Polish-led division is to be deployed in early September, but the United States has had trouble recruiting foreign troops for a second international division without a UN mandate.

"The number of troops -- boots per square inch -- is not the issue. The real issue, by the way, is intelligence. You have to have good, solid intelligence in a conflict such as this so you can get out the terrorists," Abizaid said.

The general said a larger US force would mean longer lines of communications, a need for more logistics troops and a bigger effort to protect against attacks.

"I have never been one in favor of huge, ponderous forces, but light, agile, mobile forces that not only can deal with the problem in Iraq but throughout the theater," he said.

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